Krugman’s blog, 8/29/14

August 30, 2014

There were three posts yesterday.  The first was “Austerity and the Hapless Left:”

In today’s column I am not nice to Francois Hollande, who has shown about as much strength in standing up to austerians as a wet Kleenex. But one does have to admit that he’s not alone in his haplessness; where, indeed, are the major political figures on the European left taking a stand against disastrous policies? Britain’s Labour Party has been almost surreally unwilling to challenge Cameron/Osborne’s core premises; is anyone doing better?

You can complain — and I have, often — about President Obama’s willingness to go along with belt-tightening rhetoric, the years he wasted in pursuit of a Grand Bargain, and so on; still, the Obama administration, while it won’t use the word “stimulus”, favors the thing itself, and in general American liberals have taken a much more forthright stand against hard-money, balanced-budget orthodoxy than their counterparts in Europe. Economists, in particular, have taken a much stronger stand. In Britain there are, to be sure, some prominent anti-austerity voices — Martin Wolf, Jonathan Portes, Simon Wren-Lewis, and I’m sure there are others I’m missing. But they don’t seem to have anything like the weight in the debate that Larry Summers, Alan Blinder, and many others have here.

Why the difference? I don’t really know. I have a couple of hypotheses. One is that the US intellectual ecology seems much more flexible: here, serious economists with celebrated research can also be public intellectuals with large followings, and even serve as public officials; and they can provide at least some counterweight to the Very Serious People. Think Larry Summers, but also Janet Yellen (and before her Ben Bernanke), and in a somewhat different way yours truly. Such people aren’t totally absent in Europe — Mervyn King was an academic central banker, and so in a way is Mario Draghi. But there’s much more of that in the US.

Another hypothesis is that American liberals have been toughened up by the craziness of our right, and in particular by the experience of the Bush years. After seeing the Very Serious People lionize W, a fundamentally ludicrous figure, and cheer on a war that was obviously cooked up on false pretenses, US liberals are more ready than European Social Democrats to believe that the men in good suits have no idea what they’re talking about. Oh, and America does have a network of progressive think tanks that is vastly bigger and more effective than anything in Europe.

But I’m just making suggestions here. The haplessness of the European left is still something I don’t fully understand.

Yesterday’s second post was “Germany’s Sin:”

Simon Wren-Lewis has two very good posts about the European situation, first laying out the problem, then taking on those who don’t get it. I just want to add a bit to one of his key points: the impossibility of a resolution unless Germany accepts higher inflation.

In Germany, there’s a strong tendency to moralize, with appeals to the country’s own recent economic history. We pulled ourselves out of our late 90s doldrums, the Germans say, so why can’t Southern Europe do the same?

But a key part of the answer is that Southern Europe now faces a much less favorable environment than Germany did then — and Germany is the reason why.

Look at core inflation (excluding energy, food, alcohol, and tobacco). During the years when Germany was gaining competitiveness, euro area inflation was running at around 2 percent, and inflation in Southern Europe was running considerably higher. So Germany could gain competitiveness simply by having lowish inflation — no need to actually deflate. But these days German inflation is only one percent, euro area inflation is lower, and the only way for Southern Europe to gain ground is to have zero or negative inflation:

Eurostat

This makes the adjustment problem incredibly difficult, both because wages are downwardly sticky and because deflation worsens the debt burden. Add onto this the fact that the eurozone as a whole remains depressed thanks to fiscal austerity and inadequate monetary expansion, and Germany is in effect demanding that Spain and others accomplish a task vastly harder than the Germans themselves had to achieve.

And the worst of it is that there’s no sign that Berlin understands, or is willing to understand, this reality. And if the euro fails, that refusal to think clearly will be the fundamental cause.

The last post of the work week was “Friday Night Music: Rodrigo y Gabriela:”

Boy, am I behind the curve here — didn’t even know they existed, and they turn out to have a huge following and have just appeared on Letterman again. But anyway, quite something (and very different):

Nocera, solo

August 30, 2014

Ms. Collins is off today.  In “Imagining Successful Schools” Mr. Nocera says one of the grand old men of education policy says test-based accountability has got to go.  Here he is:

What should teacher accountability look like?

We know what the current system of accountability looks like, and it’s not pretty. Ever since the passage of No Child Left Behind 12 years ago, teachers have been judged, far too simplistically, based on standardized tests given to their students — tests, as Marc S. Tucker points out in a new report, Fixing Our National Accountability System, that are used to decide which teachers should get to keep their jobs and which should be fired. This system has infuriated and shamed teachers, and is a lot of the reason that teacher turnover is so high, causing even many of the best teachers to abandon the ranks.

All of which might be worth it if this form of accountability truly meant that public school students were getting a better education. But, writes Tucker, “There is no evidence that it is contributing anything to improved student performance.” Meanwhile, he adds, test-based accountability is “doing untold damage to the profession of teaching.”

Tucker is one of the grand old men of education policy. In the 1970s, he worked at the National Institute of Education, followed by a stint at the Carnegie Corporation. In 1988, he founded the National Center on Education and the Economy, whose premise, he told me recently, is that, in order to meet the demands of a global economy, our educational system needs to be re-engineered for much higher performance.

Not long after founding the N.C.E.E., Tucker began taking a close look at countries and cities that were re-engineering successfully. What he came away with were two insights. First was a profound appreciation for the fact that most of the countries with the best educational results used the same set of techniques to get there. And, second, that the American reform methods were used nowhere else in the world. “No other country believes that you can get to a high quality educational system simply by instituting an accountability system,” he says. “We are entirely on the wrong track.” His cri de coeur has been that Americans should look to what works, instead of clinging to what doesn’t.

The main thing that works is treating teaching as a profession, and teachers as professionals. That means that teachers are as well paid as other professionals, that they have a career ladder, that they go to elite schools where they learn their craft, and that they are among the top quartile of college graduates instead of the bottom quartile. When I suggested that American cities couldn’t afford to pay teachers the way we pay engineers or lawyers, Tucker scoffed. With rare exception, he said, the cost per pupil in the places with the best educational systems is less than the American system, even though their teachers are far better paid. “They are not spending more money; they are spending money differently,” he said.

Tucker would not abolish tests, but he would have fewer of them. And they would have a different purpose: In the high-performing countries, the tests exist to hold the students accountable, rather than the teachers. Meanwhile, he writes, “in most of these countries, the primary form of accountability for the school and its staff is high-profile publication of the average scores for the exams for each school, often front-page news.”

When a school falls short, instead of looking to fire teachers, the high-performing countries “use the data to decide which schools will receive visits from teams of expert school inspectors. These inspectors are highly regarded educators.”

Tucker envisions the same kind of accountability for teachers as exists for, say, lawyers in a firm — where it is peers holding each other accountable rather than some outside force. People who don’t pull their own weight are asked to leave. The ethos is that people help each other to become better for the good of the firm. Those who successfully rise through the ranks are rewarded with higher pay and status.

Would the teachers’ unions go along with such a scheme? The unions would certainly have to shed some of the things they now have, such as control of work rules. But they would gain so much else: “Management would get their prerogatives back and would be held accountable for results, but the professionals, granted far more autonomy, would be also holding each other accountable for the quality of their work, as professionals everywhere do.”

As our conversation was coming to an end, Tucker told me that he was working with the State of Kentucky to implement some of the reforms he had outlined in his report. If it works there — and there is no reason it shouldn’t — perhaps we’ll finally get over our fixation with test-based accountability, and finally re-engineer our educational system the way every other successful country has.

Brooks and Krugman

August 29, 2014

Bobo has one of his burning questions in “The Mental Virtues:”  How do you build character in front of your keyboard at work?  Well, Bobo, you could start by not playing Gunga Din to the Mole People.  Just a thought…  Prof. Krugman also has a question in “The Fall of France:”  Has President François Hollande doomed the European project as the disastrous consequences of austerity policies grow more obvious with each passing month?  Here’s Bobo:

We all know what makes for good character in soldiers. We’ve seen the movies about heroes who display courage, loyalty and coolness under fire. But what about somebody who sits in front of a keyboard all day? Is it possible to display and cultivate character if you are just an information age office jockey, alone with a memo or your computer?

Of course it is. Even if you are alone in your office, you are thinking. Thinking well under a barrage of information may be a different sort of moral challenge than fighting well under a hail of bullets, but it’s a character challenge nonetheless.

In their 2007 book, “Intellectual Virtues,” Robert C. Roberts of Baylor University and W. Jay Wood of Wheaton College list some of the cerebral virtues. We can all grade ourselves on how good we are at each of them.

First, there is love of learning. Some people are just more ardently curious than others, either by cultivation or by nature.

Second, there is courage. The obvious form of intellectual courage is the willingness to hold unpopular views. But the subtler form is knowing how much risk to take in jumping to conclusions. The reckless thinker takes a few pieces of information and leaps to some faraway conspiracy theory. The perfectionist, on the other hand, is unwilling to put anything out there except under ideal conditions for fear that she could be wrong. Intellectual courage is self-regulation, Roberts and Wood argue, knowing when to be daring and when to be cautious. The philosopher Thomas Kuhn pointed out that scientists often simply ignore facts that don’t fit with their existing paradigms, but an intellectually courageous person is willing to look at things that are surprisingly hard to look at.

Third, there is firmness. You don’t want to be a person who surrenders his beliefs at the slightest whiff of opposition. On the other hand, you don’t want to hold dogmatically to a belief against all evidence. The median point between flaccidity and rigidity is the virtue of firmness. The firm believer can build a steady worldview on solid timbers but still delight in new information. She can gracefully adjust the strength of her conviction to the strength of the evidence. Firmness is a quality of mental agility.

Fourth, there is humility, which is not letting your own desire for status get in the way of accuracy. The humble person fights against vanity and self-importance. He’s not writing those sentences people write to make themselves seem smart; he’s not thinking of himself much at all. The humble researcher doesn’t become arrogant toward his subject, assuming he has mastered it. Such a person is open to learning from anyone at any stage in life.

Fifth, there is autonomy. You don’t want to be a person who slavishly adopts whatever opinion your teacher or some author gives you. On the other hand, you don’t want to reject all guidance from people who know what they are talking about. Autonomy is the median of knowing when to bow to authority and when not to, when to follow a role model and when not to, when to adhere to tradition and when not to.

Finally, there is generosity. This virtue starts with the willingness to share knowledge and give others credit. But it also means hearing others as they would like to be heard, looking for what each person has to teach and not looking to triumphantly pounce upon their errors.

We all probably excel at some of these virtues and are deficient in others. But I’m struck by how much of the mainstream literature on decision-making treats the mind as some disembodied organ that can be programed like a computer.

In fact, the mind is embedded in human nature, and very often thinking well means pushing against the grain of our nature — against vanity, against laziness, against the desire for certainty, against the desire to avoid painful truths. Good thinking isn’t just adopting the right technique. It’s a moral enterprise and requires good character, the ability to go against our lesser impulses for the sake of our higher ones.

Montaigne once wrote that “We can be knowledgeable with other men’s knowledge, but we can’t be wise with other men’s wisdom.” That’s because wisdom isn’t a body of information. It’s the moral quality of knowing how to handle your own limitations. Warren Buffett made a similar point in his own sphere, “Investing is not a game where the guy with the 160 I.Q. beats the guy with the 130 I.Q. Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble.”

Character tests are pervasive even in modern everyday life. It’s possible to be heroic if you’re just sitting alone in your office. It just doesn’t make for a good movie.

What a tool…  Here’s Prof. Krugman:

François Hollande, the president of France since 2012, coulda been a contender. He was elected on a promise to turn away from the austerity policies that killed Europe’s brief, inadequate economic recovery. Since the intellectual justification for these policies was weak and would soon collapse, he could have led a bloc of nations demanding a change of course. But it was not to be. Once in office, Mr. Hollande promptly folded, giving in completely to demands for even more austerity.

Let it not be said, however, that he is entirely spineless. Earlier this week, he took decisive action, but not, alas, on economic policy, although the disastrous consequences of European austerity grow more obvious with each passing month, and even Mario Draghi, the president of the European Central Bank, is calling for a change of course. No, all Mr. Hollande’s force was focused on purging members of his government daring to question his subservience to Berlin and Brussels.

It’s a remarkable spectacle. To fully appreciate it, however, you need to understand two things. First, Europe, as a whole, is in deep trouble. Second, however, within that overall pattern of disaster, France’s performance is much better than you would guess from news reports. France isn’t Greece; it isn’t even Italy. But it is letting itself be bullied as if it were a basket case.

On Europe: Like the United States, the euro area — the 18 countries that use the euro as a common currency — started to recover from the 2008 financial crisis midway through 2009. But after a debt crisis erupted in 2010, some European nations were forced, as a condition for loans, to make harsh spending cuts and raise taxes on working families. Meanwhile, Germany and other creditor countries did nothing to offset the downward pressure, and the European Central Bank, unlike the Federal Reserve or the Bank of England, didn’t take extraordinary measures to boost private spending. As a result, the European recovery stalled in 2011, and has never really resumed.

At this point, Europe is doing worse than it did at a comparable stage of the Great Depression. And even more bad news may lie ahead, as Europe shows every sign of sliding into a Japanese-style deflationary trap.

How does France fit into this picture? News reports consistently portray the French economy as a dysfunctional mess, crippled by high taxes and government regulation. So it comes as something of a shock when you look at the actual numbers, which don’t match that story at all. France hasn’t done well since 2008 — in particular, it has lagged Germany — but its overall G.D.P. growth has been much better than the European average, beating not only the troubled economies of southern Europe but creditor nations like the Netherlands. French job performance isn’t too bad. In fact, prime-aged adults are a lot more likely to be employed in France than in the United States.

Nor does France’s situation seem particularly fragile. It doesn’t have a large trade deficit, and it can borrow at historically low interest rates.

Why, then, does France get such bad press? It’s hard to escape the suspicion that it’s political: France has a big government and a generous welfare state, which free-market ideology says should lead to economic disaster. So disaster is what gets reported, even if it’s not what the numbers say.

And Mr. Hollande, even though he leads France’s Socialist Party, appears to believe this ideologically motivated bad-mouthing. Worse, he has fallen into a vicious circle in which austerity policies cause growth to stall, and this stalled growth is taken as evidence that France needs even more austerity.

It’s a very sad story, and not just for France.

Most immediately, Europe’s economy is in dire straits. Mr. Draghi, I believe, understands how bad things are. But there’s only so much the central bank can do, and, in any case, he has limited room for maneuvering unless elected leaders are willing to challenge hard-money, balanced-budget orthodoxy. Meanwhile, Germany is incorrigible. Its official response to the shake-up in France was a declaration that “there is no contradiction between consolidation and growth” — hey, never mind the experience of the past four years, we still believe that austerity is expansionary.

So Europe desperately needs the leader of a major economy — one that is not in terrible shape — to stand up and say that austerity is killing the Continent’s economic prospects. Mr. Hollande could and should have been that leader, but he isn’t.

And if the European economy continues to stagnate or worse, what will become of the European project — the long-term effort to secure peace and democracy through shared prosperity? In failing France, Mr. Hollande is also failing Europe as a whole — and nobody knows how bad it might get.

Krugman’s blog, 8/27/14

August 28, 2014

There were three posts yesterday.  The first was “The Way We Ate (Personal):”

The first time I had to cook for myself was the summer between my junior and senior years, when I was working for Bill Nordhaus on this paper (pdf); I shared a very beat-up apartment in New Haven, and tried, sort of, to do some of the cooking. To help, my mother bought me the Betty Crocker Good and Easy cookbook. And I have often told people about the, um, interesting recipes. But was my memory embellishing? Strangely, it never occurred to me to check it out on the intertubes. But I finally did — and no, I wasn’t making any of it up:

1 pound ring bologna
Cherry Pineapple Glaze (Below)
Potato Buds instant puffs (enough for 4 servings)

Cherry Pineapple Glaze
1/2 cup crushed pineapple
1/4 cup coarsely chopped maraschino cherries
1/4 cup light corn syrup
2 tabelspoons white vinegar
1/4 teaspoon cloves
2 drops red food color
1 1/2 teaspoons water
1 1/2 teaspoons cornstarch

Dear sweet Baby Jesus on a tricycle — it’s a wonder he’s still alive.  The second post yesterday was “Stockholm Syndrome in Paris:”

Sure enough, President Hollande has finally shown some steel — moving forcefully to suppress critics of his slavish adherence to the austerity demanded by Germany and Brussels.

The question I would ask is, what do Hollande and his inner circle think will make the situation turn around? Europe’s austerity drive has now gone on for four years; over the course of those four years the euro area has seen economic recovery shrivel, a much-touted comeback also stumble, and now a slide toward deflation. French economic performance tends to track the eurozone average; why should anyone expect France to come roaring back?

I’ll try to produce a more systematic analysis later today or tomorrow; but does anyone think that the Élysée Palace has a well-thought-out vision of how ever more austerity is going to produce a French renaissance? It’s just stumbling along day by day, waiting for something to turn up — when it’s much more likely that everything will turn down instead.

Yesterday’s last post was “What’s the Matter With France?:”

As I mentioned this morning, France’s President Hollande, after years of passivity, has finally taken strong action – firing anyone who questions his subservience to German and EC demands for ever more austerity. But what’s actually going on in the French economy? It is, of course, a catastrophe – hugely uncompetitive, failing to create jobs, etc. etc. – that’s what everyone says, so it must be true, right?

Actually looking at the data, however, reveals a number of surprises.

Let’s start with jobs. France has low labor force participation by the relatively old, thanks to generous retirement programs, and by the young, partly because generous aid means that few need to work while in school, partly perhaps because a high minimum wage and other factors discourage youth employment. What about prime-age workers? Figure 1 compares France and the United States. It’s a good thing we know that France is the country in crisis, isn’t it? Because otherwise you might get confused by employment performance that looks much better than ours.

Figure 1

Figure 1

Still, we know that France is highly uncompetitive on world markets. Figure 2 shows the French current account balance as a percentage of GDP, which is in, um, mild deficit, nothing like the deficits the United States ran during the “Bush boom”.

Figure 2

Figure 2

It’s interesting to note, by the way, that in the great European divide during the euro’s boom years, when costs in southern Europe surged relative to Germany, creating a huge problem of adjustment, France was – as you can see in Figure 3 – right in the middle, with no particular sign of getting out of line. This puts it in a somewhat awkward situation now that southern Europe is deflating while Germany refuses to inflate, causing an overall deflationary bias in Europe. But this isn’t a French problem so much as a euro problem.

Figure 3

Figure 3

Speaking of deflation, France – as you can see in Figure 4 — is well below the conventional 2 percent target (which is too low) and falling fast. Mr. Hollande may like to say that the French problem is supply-side, but it sure looks like demand-side by this criterion.

Figure 4

Figure 4

Still, France has to worry about bond vigilantes. After all, international investors are so worried about French prospects that they won’t lend to the country without being paid … well, the lowest rates in French history (Figure 5).

Figure 5

Figure 5

OK, you get the picture. French economic data look nothing at all like the story everyone tells. Yes, you can tell stories of excessive regulation, but they don’t dominate the macro picture. Yet Mr. Hollande is meekly going along with demands for ever more belt-tightening, reserving his wrath for those who want France to stand up for itself. And the result is a sort of multiplier process in which austerity causes growth to falter, which worsens the budget prospect, which leads to even more austerity.

What’s going on here politically? Simon Wren-Lewis makes a very good point. In America, many of the people who shape economic discourse are forever living in the 1970s, when stagflation was the order of the day; in France, the corresponding nightmare is the early Mitterand era, when France was suffering from Eurosclerosis and an attempt to pursue unilateral fiscal expansion (with a fixed exchange rate) failed. But now is not then. To an important extent, what ails France in 2014 is hypochondria, belief that it has illnesses it doesn’t – and this hypochondria is leading it to accept quack cures that are the real cause of its distress.

Blow and Kristof

August 28, 2014

Ms. Collins is off today.  In “Bill O’Reilly and White Privilege” Mr. Blow reminds us that we can’t expect equality of outcome while at the same time acknowledging inequality of environments.  Mr. Kristof has a question:  “Is Everyone a Little Bit Racist?”  He says recent events in Ferguson, Mo., have America talking about race, and that the conversation should include our unconscious attitudes that result in discriminatory policies and behavior.  Here’s Mr. Blow:

Is white privilege real? Not according to Fox News’s Bill O’Reilly.

This week O’Reilly debated the issue of white privilege with a fellow host and then returned to the topic the next day with this doozy of a statement:

“Last night on ‘The Factor,’ Megyn Kelly and I debated the concept of white privilege whereby some believe that if you are Caucasian you have inherent advantages in America. ‘Talking Points’ does not, does not believe in white privilege. However, there is no question that African-Americans have a much harder time succeeding in our society than whites do.”

It is difficult to believe that those three sentences came in that order from the same mouth. Why would it be harder for blacks to succeed? Could interpersonal and, more important, systemic bias play a role? And, once one acknowledges the presence of bias as an impediment, one must by extension concede that being allowed to navigate the world without such biases is a form of privilege.

That privilege can be gendered, sexual identity based, religious and, yes, racial.

When one has the luxury of not being forced to compensate for societal oppression based on basic identity, one is in fact privileged in that society.

O’Reilly even trotted out the Asian “model minority” trope to buttress his argument, citing low unemployment rates and high levels of income and educational attainment for Asians compared not only to blacks but to whites.

Whenever people use racial differences as an argument to downplay racial discrimination, context is always called for.

What O’Reilly — like many others who use this line of logic — fails to mention (out of either ignorance or rhetorical sleight of hand) is the extent to which immigration policy has informed those statistics and the extent to which many Asian-Americans resent the stereotype as an oversimplification of the diversity of the Asian experience.

A 2012 Pew Research report entitled “The Rise of Asian Americans” found:

“Large-scale immigration from Asia did not take off until the passage of the landmark Immigration and Nationality Act of 1965. Over the decades, this modern wave of immigrants from Asia has increasingly become more skilled and educated. Today, recent arrivals from Asia are nearly twice as likely as those who came three decades ago to have a college degree, and many go into high-paying fields such as science, engineering, medicine and finance. This evolution has been spurred by changes in U.S. immigration policies and labor markets; by political liberalization and economic growth in the sending countries; and by the forces of globalization in an ever-more digitally interconnected world.”

Following the publication of the Pew report, the news site Colorlines spoke with Dan Ichinose, director of the Asian Pacific American Legal Center’s Demographic Research Project, who was critical of some parts of the Pew report, but seemed to echo the role immigration had played. Colorlines put his response this way:

“The more complex and far less exciting explanation for Asian Americans’ relatively high rates of education has more to do with immigration policy, which has driven selectivity about who gets to come to the U.S. and who doesn’t, said Ichinose.”

Much of the African-American immigration policy came in the form of centuries of bondage, dehumanization and unimaginable savagery visited on their bodies. And that legacy is long and the scars deep.

O’Reilly mentions this in his rant, as a caveat:

“One caveat, the Asian-American experience historically has not been nearly as tough as the African-American experience. Slavery is unique and it has harmed black Americans to a degree that is still being felt today, but in order to succeed in our competitive society, every American has to overcome the obstacles they face.”

But this whole juxtaposition, the pitting of one minority group against another, is just a way of distracting from the central question: Is white privilege real?

In arguing that itisn’t, O’Reilly goes on to raise the seemingly obligatory “respectability” point, saying:

“American children must learn not only academics but also civil behavior, right from wrong, as well as how to speak properly and how to act respectfully in public.”

Then he falls back on the crux of his argument:

“Instead of preaching a cultural revolution, the leadership provides excuses for failure. The race hustlers blame white privilege, an unfair society, a terrible country. So the message is, it’s not your fault if you abandon your children, if you become a substance abuser, if you are a criminal. No, it’s not your fault; it’s society’s fault. That is the big lie that is keeping some African-Americans from reaching their full potential. Until personal responsibility and a cultural change takes place, millions of African-Americans will struggle.”

No, Mr. O’Reilly, it is statements like this one that make you the race hustler. The underlying logic is that blacks are possessed of some form of racial pathology or self-destructive racial impulses, that personal responsibility and systemic inequity are separate issues and not intersecting ones.

This is the false dichotomy that chokes to death any real accountability and honesty. Systemic anti-black bias doesn’t dictate personal behavior, but it can certainly influence and inform it. And personal behavior can reinforce people’s belief that their biases are justified. So goes the cycle.

But at the root of it, we can’t expect equality of outcome while acknowledging inequality of environments.

Only a man bathing in privilege would be blind to that.

O’Reilly is a cancerous tumor on what passes for punditry in this country.  Here’s Mr. Kristof:

Let’s start with what we don’t know: the precise circumstances under which a white police officer in Ferguson, Mo., shot dead an unarmed black teenager named Michael Brown.

But here’s what evidence does strongly suggest: Young black men in America suffer from widespread racism and stereotyping, by all society — including African-Americans themselves.

Research in the last couple of decades suggests that the problem is not so much overt racists. Rather, the larger problem is a broad swath of people who consider themselves enlightened, who intellectually believe in racial equality, who deplore discrimination, yet who harbor unconscious attitudes that result in discriminatory policies and behavior.

Scholars have found that blacks and Hispanics treated by doctors for a broken leg received pain medication significantly less often than white patients with the same injury. School administrators suspend black students at more than three times the rate of white students. Police arrest blacks at 3.7 times the rate of whites for marijuana possession, even though surveys find that both use marijuana at roughly similar rates.

Two scholars sent out nearly 5,000 résumés in response to help-wanted ads, randomly alternating between stereotypically white-sounding names and black-sounding names. They found that it took 50 percent more mailings to get a callback for a black name. A white name yielded as much benefit as eight years of experience, according to the study, published by the National Bureau of Economic Research.

These doctors, principals, prosecutors and recruiters probably believe in equality and are unaware that they are discriminating. So any national conversation about race must be a vivisection of challenges far broader and deeper than we might like to think.

Joshua Correll of the University of Colorado at Boulder has used an online shooter video game to try to measure these unconscious attitudes (you can play the game yourself). The player takes on the role of a police officer who is confronted with a series of images of white or black men variously holding guns or innocent objects such as wallets or cellphones. The aim is to shoot anyone with a gun while holstering your weapon in other cases.

Ordinary players (often university undergraduates) routinely shoot more quickly at black men than at white men, and are more likely to mistakenly shoot an unarmed black man than an unarmed white man.

I’m typical. The first time I took the test, years ago, I shot armed blacks in an average of 0.679 seconds while waiting slightly longer — 0.694 seconds — to shoot armed whites. I also holstered more quickly when confronted with unarmed whites than with unarmed blacks.

In effect, we have a more impulsive trigger finger when confronted by black men and are more cautious with whites. This is true of black players as well, apparently because they absorb the same cultural values as everyone else: Correll has found no statistically significant difference between the play of blacks and that of whites in the shooting game.

“There’s a whole culture that promotes this idea of aggressive young black men,” Correll notes. “In our minds, young black men are associated with danger.”

Further evidence for these unconscious attitudes toward race come from implicit association tests, a window into how our unconscious minds work. You can take them online at https://implicit.harvard.edu/implicit/.

One finding is that we unconsciously associate “American” with “white.” Thus, in 2008, some California college students — many who were supporting Barack Obama for president — unconsciously treated Obama as more foreign than Tony Blair, the former British prime minister. Likewise, Americans may be factually aware that Lucy Liu is an American actress and Kate Winslet is British, but the tests indicated that Americans considered Liu as more foreign than Winslet.

Yet we needn’t surrender to our most atavistic impulses. Prejudice is not immutable, and over all the progress in America on race is remarkable. In 1958, 4 percent of Americans approved of black-white marriages; today, 87 percent do.

There’s some evidence that training, metrics and policies can suppress biases or curb their impact. In law enforcement, more cameras — police car cams and body cams — create accountability and may improve behavior. When Rialto, Calif., introduced body cams on police officers, there was an 88 percent decline in complaints filed about police by members of the public.

Yet an uncomfortable starting point is to understand that racial stereotyping remains ubiquitous, and that the challenge is not a small number of twisted white supremacists but something infinitely more subtle and complex: People who believe in equality but who act in ways that perpetuate bias and inequality.

Dowd, solo vitriol

August 27, 2014

The Moustache of Wisdom is off today, so all we have is MoDo spewing venom.  In “He Has a Dream” she hisses that President Obama, who once boldly and candidly addressed race, has outsourced the issue to the Rev. Al Sharpton.  The mind boggles at what she would have said had Obama gone to Ferguson…  Here’s the bitch:

As he has grown weary of Washington, Barack Obama has shed parts of his presidency, like drying petals falling off a rose.

He left the explaining and selling of his signature health care legislation to Bill Clinton. He outsourced Congress to Rahm Emanuel in the first term, and now doesn’t bother to source it at all. He left schmoozing, as well as a spiraling Iraq, to Joe Biden. Ben Rhodes, a deputy national security adviser, comes across as more than a messagemeister. As the president floats in the empyrean, Rhodes seems to make foreign policy even as he’s spinning it.

But the one thing it was impossible to imagine, back in the giddy days of the 2009 inauguration, as Americans basked in their open-mindedness and pluralism, was that the first African-American president would outsource race.

He saved his candidacy in 2008 after the “pastor disaster” with Jeremiah Wright by giving a daring speech asserting that racial reconciliation could never be achieved until racial anger, on both sides, was acknowledged. Half black, half white, a son of Kansas and Africa, he searchingly and sensitively explored America’s ebony-ivory divide.

He dealt boldly and candidly with race in his memoirs, “Dreams From My Father.” “In many parts of the South,” he wrote, “my father could have been strung up from a tree for merely looking at my mother the wrong way; in the most sophisticated of Northern cities, the hostile stares, the whispers, might have driven a woman in my mother’s predicament into a back-alley abortion — or at the very least to a distant convent that could arrange for adoption. Their very image together would have been considered lurid and perverse.”

Now the professor in the Oval Office has spurned a crucial teachable moment.

He dispatched Eric Holder to Ferguson, and deputized Al Sharpton, detaching himself at the very moment when he could have helped move the country forward on an issue close to his heart. It’s another perverse reflection of his ambivalent relationship to power.

He was willing to lasso the moon when his candidacy was on the line, so why not do the same at a pivotal moment for his presidency and race relations? Instead, he anoints a self-promoting TV pundit with an incendiary record as “the White House’s civil rights leader of choice,” as The Times put it, vaulting Sharpton into “the country’s most prominent voice on race relations.” It seems oddly retrogressive to make Sharpton the official go-between with Ferguson’s black community, given that his history has been one of fomenting racial divides, while Obama’s has been one of soothing them.

The MSNBC host has gone from “The Bonfire of the Vanities” to White House Super Bowl parties. As a White House official told Politico’s Glenn Thrush, who wrote on the 59-year-old provocateur’s consultation with Valerie Jarrett on Ferguson: “There’s a trust factor with The Rev from the Oval Office on down. He gets it, and he’s got credibility in the community that nobody else has got.”

Sharpton has also been such a force with New York’s mayor, Bill de Blasio, in the furor over the chokehold death of a black Staten Island man that The New York Post declared The Rev the de facto police commissioner. The White House and City Hall do not seem concerned about his $4.7 million in outstanding debt and liens in federal and state tax records, reported by The Post. Once civil rights leaders drew their power from their unimpeachable moral authority. Now, being a civil rights leader can be just another career move, a good brand.

Thrush noted that Sharpton — “once such a pariah that Clinton administration officials rushed through their ribbon-cuttings in Harlem for fear he’d show up and force them to, gasp, shake his hand” — has evolved from agitator to insider since his demagoguing days when he falsely accused a white New York prosecutor and others of gang-raping a black teenager, Tawana Brawley, and sponsored protests against a clothing store owned by a white man in Harlem, after a black subtenant who sold records was threatened with eviction. A deranged gunman burned down the store, leaving eight people dead.

Sharpton also whipped up anti-Semitic feelings during the Crown Heights riots in 1991, denouncing Jewish “diamond dealers” importing gems from South Africa after a Hasidic Jew ran a red light and killed a 7-year-old black child. Amid rioting, with some young black men shouting “Heil Hitler,” a 29-year-old Hasidic Jew from Australia was stabbed to death by a black teenager.

Now, Sharpton tells Thrush: “I’ve grown to appreciate different roles and different people, and I weigh words a little more now. I’ve learned how to measure what I say.”

Obama has muzzled himself on race and made Sharpton his chosen instrument — two men joined in pragmatism at a moment when idealism is needed.

We can’t expect the president to do everything. But we can expect him to do something.

Krugman’s blog, 8/25/14

August 26, 2014

There were three posts yesterday.  The first was “Kingslayer Me:”

OK, this has to be the funniest headline I’ve seen for a while, on Business Insider: The French Government Has Collapsed, And It’s Partly Paul Krugman’s Fault. The French prime minister has tendered his resignation amid a dispute set off by the economy minister’s decision to go public with opposition to austerity orthodoxy, and since he cited me on the subject, Business Insider has made a funny.

The real story, of course, is the combination of the abject failure of austerity at a Europe-wide level, and the intransigence of the policy’s instigators:

The decision by French Prime Minister Manuel Valls to present his government’s resignation on Monday does not make any difference to Germany’s focus on economic policies that strive for growth, job-creation and fiscal consolidation, a German government spokesman said on Monday.

“We continue to work for stronger growth and employment and our government still believes there is no contradiction between consolidation and growth,” said deputy government spokesman Georg Streiter. “Nothing has changed with us.”

It’s hard to believe that more than four years have passed since I called out austerians for their belief in the Confidence Fairy; after all that time, and all the disastrous experiences (not to mention the collapse of whatever intellectual basis there was for the pro-austerity view), nothing has changed.

Yesterday’s second post was “Yellin, Wages, and Intellectual Honesty:”

Jared Bernstein is a bit puzzled by the piece of Janet Yellen’s talk at Jackson Hole in which she suggests that some of the weakness in wages may reflect delayed adjustment rather than unemployment. Since her message was basically that the Fed should keep its pedal to the metal for a while yet, why blur the message?

But I think I understand what Yellen was doing — and her willingness to do it underscores the asymmetry between the two sides in this debate.

Here’s how it works: If you believe that we’ve spent the past six years suffering from a huge overhang of excess supply, that inadequate demand is the whole story — as Yellen does, I do, and so should you — you do have one slightly awkward question to answer: while inflation has been subdued, why hasn’t it turned into deflation? If labor is in huge excess supply, why are average wages still rising, albeit slowly?

Doves like me have taken that question seriously, and placed a fair bit of weight on downward nominal wage rigidity. If wages don’t fall except in extreme cases, you can explain average wages continuing to rise by the combination of sticky wages for some workers and rising wages for those workers who, for whatever reason, face better-than-average prospects.

If that’s your story, however, it has other implications, including the one Yellen identified — a sort of delayed wage-depression effect that persists for a while even as markets recover. And Yellen felt compelled to mention that implication, I think basically because she wanted to make it clear that she was engaged in a good-faith analytical exercise, not trying to build a brief for the policy she wanted for visceral or political reasons.

What’s notable, then, is that you hardly ever see this kind of thing on the other side. Inflation hawks rarely lay out any specific model of how inflation is supposed to take off in a depressed economy; nor do they talk about testable implications of their view, or for that matter offer any explanation of why they’ve been so wrong for so long.

It is, in other words, an asymmetric debate from an intellectual point of view. Doves are doves because their analysis leads them to believe that rates should stay low, and they make a point of explaining that analysis, addressing its implications even if they don’t lend support to their policy case, and suggesting what information might lead them to change their mind. Inflation hawks know what they want, and don’t feel any need to explain clearly why or how they might be wrong.

If this reminds you of other debates these days, it should. It’s not just facts that have a liberal bias; so does careful, open-minded analysis.

The last post yesterday was “Real Americans and Real Economics:”

Maybe I’m deluding myself, but it seems to me that we’re not hearing as much as we used to about “real Americans” — the notion that the true essence of the nation is white people living in small towns, associated these days with Sarah Palin but also invoked by whatshisname, the guy who lived in the White House between Clinton and Obama and misled us into war. But I’m sure that’s still how a lot of people on the right see it.

What made me think about that concept is something sort of parallel I’ve noticed about the reaction to my writings. Often, I find, the most rage-filled emails and voice mails come after I’ve written something fairly economistic, like today’s piece. And typically, part of the rant is something along the lines of “You call yourself an economist?” You see, the person delivering the rant has a notion of what economics is; he (it’s almost always a he) believes that “real economics” is about singing the praises of free markets — basically Capitalism Roolz. It’s inconceivable to him that you could have a more nuanced view without being a Marxist. And he’s outraged both that I have the temerity to claim that I’m doing economics and that other people seem to take me seriously.

And it’s not just random Tea Partiers who think this way. It includes hosts of TV business shows, and some famous economists too.

What’s really odd about this view is that you could hardly imagine a time when the evidence was less supportive. We’re just coming off a dramatic economic collapse that had nothing to do with any obvious supply-side factors, but seemed obviously connected to malfunctioning markets. And in the aftermath of the collapse, the supposed real economists made a lot of predictions about runaway inflation, soaring interest rates, and so on that proved notably wrong, while the unreal types like me have done more or less OK.

In fact, there is remarkably little evidence that “real economics” is right even in normal times. The efficiency of competitive markets is a nice story, but where are the dramatically successful predictions we generally look for as confirmation of scientific theories? Indeed, the general presumption even within the economics profession that microeconomics is solid and known to be valid, while macroeconomics is flaky and dubious, seems to me to rest on prejudice rather than evidence. Yes, much of micro can be derived rigorously from individual maximization plus equilibrium; but why, exactly, does that make it right?

So, in my mind the real America is the diverse America we actually live in, and real economics is the eclectic mix of ideas and techniques that seem to be useful, whether or not they have rigorous microfoundations. And I say that as both a real American and a real economist.

Cohen and Bruni

August 26, 2014

Bobo and Nocera are off today, so all we have are Cohen and Bruni.  In “The Making of a Disaster” Mr. Cohen mansplains to us that a long list of American missteps paved the way to ISIS.  Mr. Bruni is feeling “Lost in America,” and moans that we’ve gone from gumption to gloom, with political implications that are impossible to foretell.  Here’s Mr. Cohen:

Almost 13 years after 9/11, a jihadi organization with a murderous anti-Western ideology controls territory in Iraq and Syria, which are closer to Europe and the United States than Afghanistan is. It commands resources and camps and even a Syrian military base. It spreads its propaganda through social media. It has set the West on edge through the recorded beheading of the American journalist James Foley — with the promise of more to come.

What went wrong? The United States and its allies did not go to war to eradicate Al Qaeda camps in Afghanistan only to face — after the expenditure of so much blood and treasure — a more proximate terrorist threat with a Qaeda-like ideology. The “war on terror,” it seems, produced only a metastasized variety of terror.

More than 500, and perhaps as many as 800, British Muslims have headed for Syria and Iraq to enlist in the jihadi ranks. In France, that number stands at about 900. Two adolescent girls, 15 and 17, were detained last week in Paris and face charges of conspiring with a terrorist organization. The ideological appeal of the likes of the Islamic State in Iraq and Syria is intact. It may be increasing, despite efforts to build an interfaith dialogue, reach out to moderate Islam, and pre-empt radicalization.

“One minute you are trying to pay bills, the next you’re running around Syria with a machine gun,” said Ghaffar Hussain, the managing director of the Quilliam Foundation, a British research group that seeks to tackle religious extremism. “Many young British Muslims are confused about their identity, and they buy into a narrow framework that can explain events. Jihadists hand them a simplistic narrative of good versus evil. They give them camaraderie and certainty. ISIS makes them feel part of a grand struggle.”

A large part of Western failure has been the inability to counter the attraction of such extremism. Perhaps racked with historical guilt, European nations with populations from former colonies often seem unable to celebrate their values of freedom, democracy and the rule of law. Meanwhile, in the Arab world the central hope of the Arab Spring has been dashed: that more open and representative societies would reduce the frustration that leads to extremism.

President Obama shunned the phrase “war on terror” to distance himself from the policies of President George W. Bush. But in reality he chose to pursue the struggle by other military means. He stepped up drone attacks on several fronts. His most conspicuous success was the killing of Osama bin Laden in 2011.

The curtain, it seemed, had fallen on America’s post-9/11 trauma. Then, a little over three years after Bin Laden’s death, ISIS overran the Iraqi city of Mosul and the world woke up to the radicalization through the festering Syrian war of another generation of Muslims; youths drawn to the slaughter of infidels (as well as Shiite Muslims) and the far-fetched notion of recreating an Islamic caliphate under Shariah law. When a hooded ISIS henchman with a British accent beheaded Foley last week, the new threat acquired urgency at last.

The list of American errors is long: Bush’s ill-conceived and bungled war in Iraq; a failure to deal with the fact that two allies, Saudi Arabia and Pakistan, have been major sources and funders of violent Sunni extremism; an inability to seize opportunity in Egypt, home to nearly a quarter of the world’s Arabs, and so demonstrate that Arab societies can evolve out of the radicalizing confrontation of dictatorship and Islamism; a prolonged spate of dithering over the Syrian war during which Obama declared three years ago that “the time has come for President Assad to step aside” without having any plan to achieve that; a lack of resolve in Syria that saw Obama set a red line on the use of chemical weapons only to back away from military force when chemical weapons were used; an inability to see that no one loves an Arab vacuum like jihadi extremists, and a bloody vacuum was precisely what Obama allowed Syria to become; and inattention, until it was too late, to festering sectarian conflict in a broken Iraqi society left to its fate by a complete American withdrawal.

The chicken that came home to roost from the Syrian debacle is called ISIS. It is not Al Qaeda. But, as the journalist Patrick Cockburn has noted, Al Qaeda “is an idea rather than an organization, and this has long been the case.”

ISIS grew through American weakness — the setting of objectives and red lines in Syria that proved vacuous. But the deepest American and Western defeat has been ideological. As Hussain said, “If you don’t have a concerted strategy to undermine their narrative, their values, their worldview, you are not going to succeed. Everyone in society has to take on the challenge.”

Now here’s Mr. Bruni:

More and more I’m convinced that America right now isn’t a country dealing with a mere dip in its mood and might. It’s a country surrendering to a new identity and era, in which optimism is quaint and the frontier anything but endless.

There’s a feeling of helplessness that makes the political horizon, including the coming midterm elections, especially unpredictable. Conventional wisdom has seldom been so useless, because pessimism in this country isn’t usually this durable or profound.

Americans are apprehensive about where they are and even more so about where they’re going. But they don’t see anything or anyone to lead them into the light. They’re sour on the president, on the Democratic Party and on Republicans most of all. They’re hungry for hope but don’t spot it on the menu. Where that tension leaves us is anybody’s guess.

Much of this was chillingly captured by a Wall Street Journal/NBC News poll from early August that got lost somewhat amid the recent deluge of awful news but deserved closer attention.

It included the jolting finding that 76 percent of Americans ages 18 and older weren’t confident that their children’s generation would fare better than their own. That’s a blunt repudiation of the very idea of America, of what the “land of opportunity” is supposed to be about. For most voters, the national narrative is no longer plausible.

The poll also showed that 71 percent thought that the country was on the wrong track. While that represents a spike, it also affirms a negative mind-set that’s been fixed for a scarily long time. As the Democratic strategist Doug Sosnik has repeatedly noted, more Americans have been saying “wrong track” than “right track” for at least a decade now, and something’s got to give.

But to what or whom can Americans turn?

In the most recent of Sosnik’s periodic assessments of the electorate, published in Politico last month, he wrote: “It is difficult to overstate the depth of the anger and alienation that a majority of all Americans feel toward the federal government.” He cited a Gallup poll in late June that showed that Americans’ faith in each of the three branches had dropped to what he called “near record lows,” with only 30 percent expressing confidence in the Supreme Court, 29 percent in the presidency and 7 percent in Congress.

The intensity of Americans’ disgust with Congress came through in another recent poll, by ABC News and The Washington Post. Typically, Americans lambaste the institution as a whole but make an exception for the politician representing their district. But in this poll, for the first time in the 25 years that ABC and The Post had been asking the question, a majority of respondents — 51 percent — said that they disapproved even of the job that their own House member was doing.

So we can expect to see a huge turnover in Congress after the midterms, right?

That’s a rhetorical question, and a joke. Congress wasn’t in any great favor in 2012, and 90 percent of the House members and 91 percent of the senators who sought re-election won it. The tyranny of money, patronage, name recognition and gerrymandering in American politics guaranteed as much. Small wonder that 79 percent of Americans indicated dissatisfaction with the system in the Journal/NBC poll.

Conventional wisdom says that President Obama’s anemic approval ratings will haunt Democrats. But it doesn’t take into account how effectively some Republicans continue to sully their party’s image. It doesn’t factor in how broadly Americans’ disapproval spreads out.

Conventional wisdom says that better unemployment and job-creation numbers could save Democrats. But many Americans aren’t feeling those improvements. When asked in the Journal/NBC poll if the country was in a recession — which it’s not — 49 percent of respondents said yes, while 46 percent said no.

The new jobs don’t feel as sturdy as the old ones. It takes more hours to make the same money or support the same lifestyle. Students amass debt. Upward mobility increasingly seems a mirage, a myth.

“People are mad at Democrats,” John Hickenlooper, the Democratic governor of Colorado, told me. “But they’re certainly not happy with Republicans. They’re mad at everything.” That’s coming from the leader of a state whose unemployment rate is down to 5.3 percent.

And it suggests that this isn’t just about the economy. It’s about fear. It’s about impotence. We can’t calm the world in the way we’d like to, can’t find common ground and peace at home, can’t pass needed laws, can’t build necessary infrastructure, can’t, can’t, can’t.

In the Journal/NBC poll, 60 percent of Americans said that we were a nation in decline. How sad. Sadder still was this: Nowhere in the survey was there any indication that they saw a method or a messenger poised to arrest it.

Well, you can drown all the Republicans…

Blow and Krugman

August 25, 2014

In “A Funeral in Ferguson” Mr. Blow reminds us that nobody should know what it feels like to bury a child as the whole world watches. But that is what Michael Brown’s parents must do.   In “Wrong Way Nation” Prof. Krugman says the Sunbelt may be growing in population, but it’s not because of pro-business and pro-wealthy policies and higher wages.   Here’s Mr. Blow:

Two weeks after the killing of Michael Brown, we have become painfully familiar with his parents through their public appearances and television interviews, their faces drawn, their sorrow apparent.

Brown’s mother, Lesley McSpadden, constantly dabbing tears from her face, sparing in her responses, but powerfully articulating her agony with the words she chooses. Brown’s father, Michael Brown Sr., with shaved head and full beard, a large man often clad in a T-shirt emblazoned with the phrase “No Justice, No Peace” and a baby picture of his son. The senior Brown is stoic, resolute in his speech, but even in the power of his presence there is the certainness that a hollow space has been made.

On Monday, they are scheduled to bury their boy as the whole world watches.

No one should know what that feels like.

Whatever one may feel about the contours of this case — about what led Officer Darren Wilson to shoot the teenager, about the relationship of the police to people of color, about the protests and unrest that followed, about the militarized police response to the unrest, about the quality of the investigations and the level of confidence people have in them, about the perverse sense of theater emerging from the rhythms of the days under the glare of media lights — we can all, in our shared humanity, feel for parents who lose a child.

As a parent myself, I can’t fathom the ache and inextinguishable anguish that must accompany such a loss.

Losing any loved one is painful, but losing a child — particularly in such a violent way and particularly a young child — must be exceedingly painful. It also upsets the order of things. Children should outlive you. That’s the way it’s supposed to be, the way the world and life would have it. But, in a moment, the world stops making sense.

I don’t think anyone can be properly prepared to deal with the news of such a thing. In an interview with CNN’s Anderson Cooper on Thursday, the mother recounted, with tears streaming down her face, the feeling of getting the call that her son had been shot, before getting to the scene:

“Before even getting there, somebody call you on the phone and tell you something like that, and you miles away. It’s terrible.”

The father recounted the excruciating wait once he and the mother arrived on the scene and how upsetting it all was:

“We couldn’t even see him. They wouldn’t even let us go see him. They just left him out there, four and a half hours, with no answers. Wouldn’t nobody tell us nothing.”

It’s hard to imagine a more painful scenario and the grief it must carry.

And that grief can last for a very long time.

A 2008 study published in The Journal of Family Psychology found that, understandably, the death of a child can have “long-term effects on the lives of parents,” including “more depressive symptoms, poorer well-being, and more health problems.” Even that, to me, feels like an understatement. I am always in awe at the strength displayed by parents who lose a child and are immediately thrust into the public eye because their children cease to simply be children but graduate into being a cause.

Yet, too many people have had to endure a similar grief, if often under different circumstances. According to ChildDeathReview.org, in 2010, 45,068 children ages 0 to 19 died in the United States. Two-thirds died of natural causes. Another 8,684 died of unintentional injuries like car accidents and drowning. But 2,808 died as result of homicide, including 1,790 by firearm.

And when the person being shot is shot not by one of the bad guys (people all parents teach children to avoid as best they can) but by one of the people we as a society count as one of the good guys (police officers sworn to protect and serve) there are obviously going to be questions that need answering.

Whenever I see parents like these, standing and speaking in the wake of tragedy, I find myself studying their faces, imagining — hoping, really — that if I were them, I, too, would be this strong, that I, too, would fight on my child’s behalf, for justice and against the besmirchment of his or her memory. But something in me whispers that it’s a lie, that I would be overcome and inconsolable, that so much of me would die with my child that not enough of me would be left to carry on.

So the least I think all of us can do, in consoling solidarity, is to join them in paying our last respects. At 10 a.m. Central time on Monday, when the funeral is scheduled to begin, take a moment to think of them, to commiserate with two grieving parents, knowing they are in a position that none of us would want to be in.

Now here’s Prof. Krugman:

Gov. Rick Perry of Texas is running for president again. What are his chances? Will he once again become a punch line? I have absolutely no idea. This isn’t a horse-race column.

What I’d like to do, instead, is take advantage of Mr. Perry’s ambitions to talk about one of my favorite subjects: interregional differences in economic and population growth.

You see, while Mr. Perry’s hard-line stances and religiosity may be selling points for the Republican Party’s base, his national appeal, if any, will have to rest on claims that he knows how to create prosperity. And it’s true that Texas has had faster job growth than the rest of the country. So have other Sunbelt states with conservative governments. The question, however, is why.

The answer from the right is, of course, that it’s all about avoiding regulations that interfere with business and keeping taxes on rich people low, thereby encouraging job creators to do their thing. But it turns out that there are big problems with this story, quite aside from the habit economists pushing this line have of getting their facts wrong.

To see the problems, let’s tell a tale of three cities.

One of these cities is the place those of us who live in its orbit tend to call simply “the city.” And, these days, it’s a place that’s doing pretty well on a number of fronts. But despite the inflow of immigrants and hipsters, enough people are still moving out of greater New York — a metropolitan area that, according to the Census, extends into Pennsylvania on one side and Connecticut on the other — that its overall population rose less than 5 percent between 2000 and 2012. Over the same period, greater Atlanta’s population grew almost 27 percent, and greater Houston’s grew almost 30 percent. America’s center of gravity is shifting south and west. But why?

Is it, as people like Mr. Perry assert, because pro-business, pro-wealthy policies like those he favors mean opportunity for everyone? If that were the case, we’d expect all those job opportunities to cause rising wages in the Sunbelt, wages that attract ambitious people away from moribund blue states.

It turns out, however, that wages in the places within the United States attracting the most migrants are typically lower than in the places those migrants come from, suggesting that the places Americans are leaving actually have higher productivity and more job opportunities than the places they’re going. The average job in greater Houston pays 12 percent less than the average job in greater New York; the average job in greater Atlanta pays 22 percent less.

So why are people moving to these relatively low-wage areas? Because living there is cheaper, basically because of housing. According to the Bureau of Economic Analysis, rents (including the equivalent rent involved in buying a house) in metropolitan New York are about 60 percent higher than in Houston, 70 percent higher than in Atlanta.

In other words, what the facts really suggest is that Americans are being pushed out of the Northeast (and, more recently, California) by high housing costs rather than pulled out by superior economic performance in the Sunbelt.

But why are housing prices in New York or California so high? Population density and geography are part of the answer. For example, Los Angeles, which pioneered the kind of sprawl now epitomized by Atlanta, has run out of room and become a surprisingly dense metropolis. However, as Harvard’s Edward Glaeser and others have emphasized, high housing prices in slow-growing states also owe a lot to policies that sharply limit construction. Limits on building height in the cities, zoning that blocks denser development in the suburbs and other policies constrict housing on both coasts; meanwhile, looser regulation in the South has kept the supply of housing elastic and the cost of living low.

So conservative complaints about excess regulation and intrusive government aren’t entirely wrong, but the secret of Sunbelt growth isn’t being nice to corporations and the 1 percent; it’s not getting in the way of middle- and working-class housing supply.

And this, in turn, means that the growth of the Sunbelt isn’t the kind of success story conservatives would have us believe. Yes, Americans are moving to places like Texas, but, in a fundamental sense, they’re moving the wrong way, leaving local economies where their productivity is high for destinations where it’s lower. And the way to make the country richer is to encourage them to move back, by making housing in dense, high-wage metropolitan areas more affordable.

So Rick Perry doesn’t know the secrets of job creation, or even of regional growth. It would be great to see the real key — affordable housing — become a national issue. But I don’t think Democrats are willing to nominate Mayor Bill de Blasio for president just yet.

Krugman’s blog, 8/23/14

August 24, 2014

There were three posts yesterday.  The first was “Another Night in Brooklyn:”

Will Butler of Arcade Fire and some guy wearing funny clothes

Will Butler of Arcade Fire and some guy wearing funny clothes

Arcade Fire at Barclays Center. I’ve been following their music more or less obsessively for years, but this was my first live concert. It’s quite an experience — watching the videos doesn’t give you anything like the feel for the sheer energy and joy, both of the band and the audience. I have to admit that the sound in a big arena is a bit murky — the bass was too loud — so it helped if you already knew and loved all the songs, which I did. Wake Up was a stunning climax, as always.

Really fantastic. Oh, and let’s hear it for the great city of New York, where the subways run all night, and a guy taking the 2 train at midnight in a monkey suit attracts no attention at all.

Yesterday’s second post was “Draghi at Deflation Gulch:”

Full disclosure: I know Mario Draghi, a bit, since we overlapped in grad school, and I both like and admire him; he did a fantastic job of containing the euro crisis of 2012. And I like to imagine that he knows and understands more than he can say in his position. Still, I don’t think I’m projecting too much in reading his Jackson Hole speech as the words of a man who knows perfectly well how dire the situation is, and is sailing as close to the wind as he can, but is all too aware of how inadequate that’s likely to be.

Although he gives a nod to structural factors, he effectively declared that people in Europe are exaggerating the problem:

Research by the European Commission suggests that estimates of the Non-Accelerating Wage Rate of Unemployment (NAWRU) in the current situation are likely to overstate the magnitude of unemployment linked to structural factors, notably in the countries most severely hit by the crisis

and he basically says that the problem with the euro is inadequate demand:

The most recent GDP data confirm that the recovery in the euro area remains uniformly weak, with subdued wage growth even in non-stressed countries suggesting lacklustre demand. In these circumstances, it seems likely that uncertainty over the strength of the recovery is weighing on business investment and slowing the rate at which workers are being rehired.

So he’s effectively saying the same thing as Janet Yellen: if unemployment is structural, where are the wage gains?

Also, the confidence fairy has vanished from official ECB rhetoric. So has the ECB’s trigger-happiness when it comes to any hint of inflation:

The risks of “doing too little” – i.e. that cyclical unemployment becomes structural – outweigh those of “doing too much” – that is, excessive upward wage and price pressures.

The trouble is, what can he do about it? He appeals for a consideration of euro-wide measures of fiscal stance, which is basically urging Germany to run bigger deficits, but the Germans aren’t interested. He says that the ECB will do more, but doesn’t promise massive QE, probably because he knows he can’t.

The point is that even if Draghi is, as I believe he is, a good man and a good economist who gets the situation, the combination of the euro’s structure and the intransigence of the austerians means that the situation remains very grim.

Yesterday’s last post was “Attack of the Crazy Centrists:”

I’m by no means the only person, or even pundit, who sometimes (often) feels that centrists are the craziest people in our political life. Liberals these days rarely stake out really extreme positions (more on that in a minute); conservatives may denounce Obama as a Muslim atheist communist, but at least they know what they want. The really strange people are those who insist that there is symmetry between left and right, that both are equally far out and equally at fault for polarization, and make up all kinds of strange stories to justify this claim.

Barack Obama is, of course, the biggest target of these delusions; it’s really amazing to see pundits accuse him of being chiefly to blame for Republican scorched-earth opposition — you see, he should have used his mystic powers of persuasion to bring them into the tent. But liberal commentators also get hit — usually via gross misrepresentations of what we said. And of course I get this most of all.

Today Jonathan Bernstein leads me to Andrew Gelman, who catches an assertion that I’m all wrong about the difference in conspiracy theorizing between left and right.

What I said was that conspiracy theories are supported by a lot of influential people on the right, but not on the left. They misrepresent this as a claim that most conspiracy theorists are on the right, and point to evidence that “motivated reasoning” is equally common on left and right as proof that I’m wrong.

This is doubly wrong. For one thing — Gelman doesn’t say this as clearly as I’d like — motivated reasoning isn’t the same thing as conspiracy theorizing. Believing that official inflation numbers understate true inflation, based not on understanding the data but on political leanings, is motivated reasoning. Believing that the BLS is deliberately understating inflation and unemployment as a political favor to the White House is a conspiracy theory.

And there’s a big difference even when it comes to conspiracy theorizing between having something believed by some, maybe even a lot, of people and having it stated by influential politicians and other members of the elite.

So how did my claim about elites and conspiracy theories — which I think is very defensible, even obvious — turn into a supposed claim that isn’t defensible, and can be dismissed as foolish? Well, you know the answer: centrists want to believe that liberals are just as bad as conservatives, so they see shrill partisanship even when it’s not really there.

It is, in short, a classic illustration of politically motivated reasoning.


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